Stocks, Bonds and The Trump Factor

Traditionally investors have assumed that stocks and bonds are not highly correlated in their performance, tending to move in opposite directions. In reality, this is not always the case.

At times, this means that simply combining stocks with government o r other high - quality bonds may not actually offer much benefit of diversification in your clients’ portfolios.

Today, however, as the market’s attention turns from inflation fears to concern about Trump’s trade wars, we may see the traditional pattern coming back. This in turn may affect how you advise your clients in terms of portfolio construction.